Remember if your rental is creating a profit in excess of depreciation, paying some more income tax is a good problem.

Since I already own the home I figure we could split the profit from the sell or from the refinance.

I would certainly try to point out the fact that selling it on the market would cut into their profit as they would have expenses surrounding an agent, paying the tax title, etc however it's never guaranteed that people will listen.

@Ira Jeter doesnt sound like there is much profit left.

There is a home that is within 10 feet of the property line and I am going to send that neighbor a "neighbor letter" offering him first dibs (for a profit). 

Think about it, even if I only make $5,000 of profit (not income, profit) from agent fees annually, I still make more than most landlords with 1, or a few SFH properties.

I wouldn't, I'd rather partner with the investor and share the profits. 

If the seller sells after 365 days, it is long term capital gains, unless the seller lived in the property 2 of the last 5 years, then there is no capital gains.A good example of optimal tax write offs and profitability is in the following spreadsheet.

I am looking for the fastest and economically savviest way to make my first real estate investment a successful and profitable one.

I'll go into more detail below, but I'm trying to figure out if this means the owner is earning no profits while his mortgage is being paid off.